Author: Gerry Murphy, former president, SunGard’s brokerage & clearance business
Everyone talks about market volatility, more stringent regulation and the global management of credit. But even as these new challenges reshape this industry, financial services firms continue to face familiar issues, too: the pressure to reduce costs, demanding clients, industry consolidation, and increased growth in trading, particularly in the global futures and options market.
Have firms adjusted their technology and business strategies to reflect this new environment?
Many of them have. But many others still rely on regional services and multiple applications, while departments are divided into silos. This leads to duplicated efforts in many areas, from managing collateral to opening accounts. Reducing that inefficiency is key to cutting costs but also to responding to these new challenges. For instance, enterprise-wide platforms and services can help firms create a consolidated view across their organization so that they can manage and mitigate risk globally.
Clearly, every financial institution must be able to manage and identify their overall risk or exposure to a given customer or counter party. More and more OTC products are trying to find a way into the listed space to reduce that very risk and exposure. And more discussions over the various CCPs globally are popping up.
Firms can no longer rely on the old models and old assumptions. What made sense 18 months ago is not necessarily best practice now. Organizations are searching for the right strategy and for the next business model. The series of events that we are holding this year around the world, SunGard’s City Days, is a great opportunity for this type of conversation.
How are you keeping up with the evolution of the industry? What do you need to change and what will help you succeed in this turbulent, yet familiar, market?